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Thanks! Your details of one time charges passing through to invoice/billing, probably bypassing aggregation, totally makes sense. I’m thinking of that case as s

Thanks! Your details of one time charges passing through to invoice/billing, probably bypassing aggregation, totally makes sense. I’m thinking of that case as something like “incurred line items” now. I haven’t seen that much as I’m more on the Service side of the *aaS space. And yes the variable pricing still makes sense there. I like your example of variable decline fee based on plan as an analogue to my related SKU discounts I mentioned in another comment. Edit: belated additions to your great list of “basics most people miss some of”: pro rating & amendments, especially retrospective prorata! And the classic retrospective amendments after you’ve crossed a billing period. Aka “we’re sorry and here are some fungible credits!”

doctor_eval 4y ago
The interesting thing about one time charges is that they can come from anywhere. Maybe you need to charge for sending an SMS late payment reminder, or even a late fee. In some countries you can even charge a credit card success fee, which needs to appear on the next invoice. One time charges solve all these problems. Pro-rating is a real spanner in the works! If you’re half way through a month and you’ve already charged $100 for the “silver” plan, and the customer wants to upgrade to “gold”, you need to refund the unused half of the month on “silver”, or somehow take that already invoiced amount into account during the upgrade process. The only alternative is to give “gold” away for half a month (which opens a path for gaming) or to wait until the end of the month to change the plan (pisses the customer off). Calculating all this accurately is possible, but very hairy, and the solutions we came up with after many years in the space were non obvious. It’s far from rocket science, of course, but it’s far from straight forward.

doctor_eval 4y ago

The interesting thing about one time charges is that they can come from anywhere. Maybe you need to charge for sending an SMS late payment reminder, or even a late fee. In some countries you can even charge a credit card success fee, which needs to appear on the next invoice. One time charges solve all these problems. Pro-rating is a real spanner in the works! If you’re half way through a month and you’ve already charged $100 for the “silver” plan, and the customer wants to upgrade to “gold”, you need to refund the unused half of the month on “silver”, or somehow take that already invoiced amount into account during the upgrade process. The only alternative is to give “gold” away for half a month (which opens a path for gaming) or to wait until the end of the month to change the plan (pisses the customer off). Calculating all this accurately is possible, but very hairy, and the solutions we came up with after many years in the space were non obvious. It’s far from rocket science, of course, but it’s far from straight forward.